The Open Network for Digital Commerce (ONDC) has taken a significant step in expanding its fintech services by launching digital credit offerings. This new feature allows users to access fully digital, paperless loans in six minutes. As part of its broader financial services strategy, ONDC also plans to introduce insurance and mutual fund offerings within the next two months.
For the credit facility, ONDC has integrated nine buyer applications, including Easypay, Paisabazaar, Tata Digital, Invoicepe, Cliniq360, Zyapaar, Indipe, Tyreplex, and Paynearby, with three lenders: Aditya Birla Finance, DMI Finance, and Karnataka Bank.
Following this launch, ONDC plans to expand its financial services offerings further. By the end of September 2024, the platform is expected to introduce GST invoice financing loans. Additionally, ONDC will soon offer purchase financing for individuals and sole proprietors, as well as working capital lines for partnerships and private limited companies. Future plans include providing farmers’ loans and credit cards, catering to a broader spectrum of financial needs.
ONDC CEO, Thampy Koshy, told Financial Express, “After launching credit, we may do the same for insurance and mutual funds. We may see insurance and mutual fund providers coming on the platform in the next few months.
He also revealed that the network crossed 12 million transactions in July and aims to reach 30 to 40 million transactions per month by the end of the financial year. There is also a strong pipeline of buyer applications and lenders, including big names like HDFC Bank and IDFC First Bank, eager to join the network.
To facilitate rapid and efficient loan processing, the ONDC credit system leverages four digital public goods: Account Aggregator for data, DigiLocker/Aadhaar for KYC, eNACH/eMandate for repayment, and Aadhaar eSign for agreement signing. This integration not only simplifies the borrowing process but also enhances financial inclusion, aligning with ONDC’s mission of broadening access to financial services across India.